6 tips for start-ups to use their data
Good use of data offers companies many advantages. Improving the customer experience, making better product decisions, ensuring good planning are just examples. However, managing large volumes of data can seem overwhelming, as employees can feel overwhelmed when making decisions.
Every company wants to harness its data, but how to do so?
There are tools and strategies to help start-ups get started and get the most out of their data.
Choose the right tools
Rule 1:No more wading through thousands of rows and columns of data in Excel. Spreadsheets can be useful, but they evolve with difficulty and quickly become complex. With teleworking becoming increasingly common, version control can be time-consuming. Collaboration capacity cannot be sacrificed and cannot be afforded.
More practical and advanced tools are available today, so why not take advantage of them? You should consider having dedicated data storage or visualisation tools, or other tools, to help your data scientists keep track of resources and control costs.
Financial reporting is a feature of NetSuite that can be used for both accounting and business management.
Dave Rosenberg, head of marketing and business development and private equity EMEA for Oracle NetSuite, says: "Go take an online data science course or something similar, because you can very quickly see gaps in your business where you don't expect them, whether it's forecasting, inventory or something else.
Integrating data analysis from the start
Using data at an early stage is crucial. Not only will this help you in the long run, it will also help you in your search for investors. Indeed, they often have a long-term view of the company.
Present your data together with your financial plans for the coming years. It is important that investors see a company that knows how to use its data. This will help you illustrate current and future growth based on scenarios using different data.
Without a good financial plan detailing growth plans and the data to follow them, investors will not be able to make informed decisions about their investments.
EXPLOIT YOUR DATA
There is a recurring problem with data: most companies collect it, but very few know how to use it.
This is sometimes due to volume. Large companies find it difficult to identify and use their data because of the sheer volume of data. Conversely, other companies do not collect enough data. Data must be collected even if there is no analysis project yet. Sometimes the data will not be useful until much later. But if they are not collected gradually, there will be no turning back.
The analysis and management of data is becoming more and more systematic in the daily management of companies. This makes it easier to take advantage of it at the right time.
Impress your current and future investors
It is often difficult to convince investors without presenting them with figures. These figures should show where your company is, but more importantly, where it is going.
Investors are usually looking for a solid business model and want to understand the different possible scenarios (although some events are a little more difficult to predict than others). By presenting them with different scenarios, you show that you have considered different situations, and that management is better able to identify warning signs and possible difficulties, and then respond appropriately.
You must be able to understand the factors affecting your business. Analysing customer behaviour and product development in terms of data. Keeping investors well informed about decisions made and the role of data is an important step.
Sometimes the people and tools for collecting and using data will be chosen according to your growth. Investing in data is not always necessary, but if complex decisions have to be made, it may be necessary to recruit the right people and equip yourself with the tools to find the data.
However, a dedicated data team is not always necessary. It is possible to outsource data management. Your internal team will then only have to manage a part of it with appropriate tools. You will be able to strengthen your team and the tools at your service over time and as needed.
Choosing financial data before a takeover bid
Even if going public is not the first step in your company's life, it is often an ambition of many start-ups. It is never too early to prepare your financial data with best practices for takeover bids in mind.
Implementing financial software little by little can be very expensive. Decision-makers should bear in mind that current regulations prohibit them from changing their financial systems during the takeover bid process and one year after the takeover. If you do not have a system that allows key stakeholders to access key data in real time at an early stage, this activity may be more complicated.
If you are considering a takeover bid, you should be prepared to provide at least three years of audited financial data. Investors will want to see reassuring debt-to-equity ratios, sufficient market capitalisation and reliable sales and earnings forecasts. Finally, various processes must be in place in the areas associated with sales, staffing and other important expenses. Your financial infrastructure must have control systems to manage these processes, while being flexible enough to adapt to future changes.
Exploiting data is not an absolute guarantee of results, but being prepared and having robust systems in place will make it easier. Taking these steps and reinforcing them with an effective management system can greatly increase your chances of success.
Sponsored article. The expert contributors are independent authors of the appvizer. Their comments and positions are personal.
Article translated from Italian